MSPB Finds Army Partially Out of Compliance with Order

The MSPB canceled the two indefinite suspensions of a former Army aircraft mechanical parts worker and ordered the agency to pay the employee back pay with interest and other benefits.

After the employee alleged that the agency failed to comply with this order by not fully restoring his annual leave, failing to make the appropriate contributions to his Thrift Savings Plan (“TSP”) account, and erroneously calculating his overtime back pay, the agency admitted during the compliance proceedings that it had improperly calculated the employee’s TSP contributions. The agency attempted to remedy the error with a lump sum payment that it claimed was an “accurate approximation of the amount owed,” claiming that because the employee was no longer federally employed, the agency could not make actual contributions into his TSP account. An MSPB administrative judge found that the agency was in compliance with regard to the overtime back pay but out of compliance with the order regarding payment for annual leave and contributions to the employee’s TSP account. The employee petitioned the full Board for review. On November 4, 2015, the Merit Systems Protection Board granted the employee’s petition for review, affirmed the compliance initial decision’s finding that the agency was not in compliance regarding annual leave and contributions to the TSP account, modified the compliance initial decision to address an agency argument regarding the employee’s entitlement to TSP contributions, and reversed the compliance initial decision’s finding that the agency’s method of calculating overtime back pay was in compliance with the Board’s order.

As the Board noted, the agency was required to correct errors affecting the employee’s TSP account “consistent with the regulations prescribed by the Federal Retirement Thrift Investment Board (“FRTIB”). However, after considering the agency’s claim that it overestimated the amount of makeup contributions due to the employee, the Board found that because the employee had received two separate financial hardship withdrawals from his TSP account, the employee became ineligible for TSP contributions for a period of six months after each withdrawal. Although the second financial hardship withdrawal occurred after the employee was indefinitely suspended by the agency, and although the “negative consequences of this second withdrawal could be related to the [employee’s] indefinite suspension and could represent damages,” the Board found that the employee’s appeal did not fall into one of the “limited categories of cases in which the Board is authorized to award damages.” The Board also noted that the employee had not identified any other provision, either in the Back Pay Act or the FRTIB’s regulations, that would allow the Board to grant damages based on the employee’s need to make a financial hardship withdrawal primarily because of the agency’s eventually canceled decision to indefinitely suspend the employee.

The employee argued that the administrative judge failed to address whether the agency should have restored the funds the employee withdrew from his TSP account, but the Board found that employees who are separated from service are entitled to restore funds withdrawn from their TSP accounts at the time of their separations, not funds withdrawn as part of a financial hardship withdrawal. The Board also found that even if the employee was entitled to restore the withdrawn funds, it would require no action by the agency because the entitlement is only to an allowance of the restoration of withdrawn funds.

Despite the above issues with the employee’s requests, the Board also found that the agency, which “[had] not presented any additional evidence” that proved compliance, had not met its burden of proving its compliance with the Board decision. Therefore, the Board found that the agency was out of compliance regarding the employee’s TSP contributions, and ordered the agency to correctly calculate the employee’s TSP make-up contributions.

The Board held that, contrary to the employee’s argument on appeal, the employee could not receive back pay for overtime that he “would have worked” during periods of administrative leave that preceded his two canceled indefinite suspensions because of the inherent limitations of the Back Pay Act. As noted by the Board, the employee’s placement on administrative leave did not constitute an “adverse action” and was therefore not remediable under the Back Pay Act. However, the Board found that overtime back pay for the periods of the indefinite suspensions could be computed based on the employee’s own overtime work history. According to the Board, “[a]lthough the [employee] is not entitled to receive a windfall, he is entitled to be restored to the status quo ante.” Because the employee’s work history demonstrated that he worked regular overtime (significantly more than most employees), the Board was unpersuaded by the agency’s argument that the proper calculation should be based on the average of the overtime worked by employees in the same position and grade level within the directorate.

For the above stated reasons, the Merit Systems Protection Board ordered the agency to demonstrate, within 60 days, that it had properly calculated the employee’s overtime back pay and TSP make-up contributions.